PEP sells New Zealand's Manuka Health
Pacific Equity Partners (PEP) has agreed to sell Manuka Health, a New-Zealand based producer of premium honey – used in dietary supplements, gourmet foods and personal care products – that it acquired three years ago.
The buyer is reportedly Hong Leong Group, a Malaysian conglomerate with operations spanning financial services, manufacturing, real estate, and hospitality and real estate. Manuka is growing in popularity in Asia and several Chinese groups were also said to be pursuing the asset.
Manuka honey is produced by bees using a kind of tree native to Australia and New Zealand and known for its healing properties. Manuka Health, which was founded in 2006, claims to be the first company globally to establish a scientific certification system for the honey.
Waterman Capital acquired a minority stake in the business in 2012 and held it until PEP’s acquisition in 2015. The New Zealand-based GP claimed that revenue grew fourfold during its holding period. PEP planned to help Manuka Health continue to develop an international network that now covers 11,000 stores in 45 countries.
Investor interest in manuka was recently underlined by Wattle Hill RHC – a private equity firm that targets Australian businesses with products and services that appeal to Chinese consumers – and ROC Partners making a A$189.7 million ($138 million) privatization bid for Capilano Honey. Oher deals include the acquisition of Honey New Zealand by Fortune Fountain Capital, a Chinese family office.
New Zealand-listed honey products business Comvita also became a take-private target this year, although negotiations fell through after the company announced a profit downgrade due to a weaker-than-expected honey harvest. Comvita launched a joint venture in 2017 and revenue reached NZ$46 million ($30 million) in the first year. Overall revenue for the 2018 financial year was NZ$178.5 million.
The manuka market has become so lucrative that last year a New Zealand trade association applied for exclusive rights to market manuka honey in five countries, including China, the US, the UK, and Australia. This prompted an angry response from Australian beekeepers.
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